The Bank of England made “persistent and systematic” errors in its forecasts about inflation, one of its policymakers has said.

Swati Dhingra, an external member of the Monetary Policy Committee, was one of two officials to vote for a reduction in interest rates from 5.25pc to 5pc on Thursday. In the event, rates were kept on hold.

Ms Dhingra was speaking at a conference hosted by King’s College London following former Federal Reserve chair Ben Bernanke’s review into the Bank of England’s forecasting errors.

Inflation surged to 11.1pc in October 2022, leading the Bank of England to raise interest rates to 16-year highs.

Ms Dhingra said: “At the end of the day even these statistical models will systematically over predict or under predict … when a turning point comes they are going to do exactly the opposite.

“Even the best forecasting models, they will always have inherent and some level of uncertainty and inaccuracy.”

Her comments come as the Bank of England’s chief economist warned about the risk of being “seduced” by data showing a slowdown in inflation after his boss said interest rate cuts will be needed soon.

Huw Pill, who voted for interest rates to remain at 5.25pc, said the Monetary Policy Committee which sets rates must make sure “that we ensure that inflation is at target on a lasting and sustainable basis”.

Mr Pill was speaking a day after Governor Andrew Bailey said that interest rate cuts will be needed and could happen faster than markets anticipate. 

It comes as Britain exited recession with faster-than-expected growth at the start of the year.

Money markets traders are currently betting that there is a 60pc chance of a rate cut happening in June.

Inflation has fallen to 3.2pc and Mr Bailey said that the Bank believes inflation may already be at its 2pc target following a drop in the energy price cap.

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